NZD/USD bears the burden of US dollar bounce above 0.7100

NZD/USD takes offers around 0.7127, down 0.10% intraday, during early Monday. In doing so, the kiwi pair respects the US dollar rebound, amid a risk-off mood, while declining for the second consecutive day.

The US dollar index (DXY) portrays a corrective pullback from the lowest in a month, flashed on Friday, while picking up bids near 91.68, up 0.16% on a day. The greenback’s latest gains could be traced from the downbeat performance of S&P 500 Futures, -0.24% intraday by the press time, as well as mildly offered US Treasury yields.

Although the Asian trading session remains quiet amid a lack of major catalysts, talks that US President Joe Biden will have to lower his tax hike target for the bipartisan approval to his $2.25 trillion infrastructure spending plan seemed to have weighed on the sentiment. Also on the risk-negative side could be the coronavirus (COVID-19) fears in Europe and Asia.

Alternatively, the opening of national boundaries between Australia and New Zealand, coupled with the return of no quarantine rule for travelers of the key Pacific trading partners, should have challenged the risk-off mood. Also on the positive side are the upbeat US data and faster vaccinations in the US and the UK, which in turn propel the economic recovery hopes.

Earlier in the day, New Zealand’s Business NZ PSI grew beyond upwardly revised 49.7 prior readings to 52.4 in March.

Moving on, a lack of major data/events on the calendar will keep NZD/USD traders directed towards the risk news for fresh impulse. Among them, US infrastructure spending and the covid will be the key to watch.

Technical analysis

A clear break below the confluence of 50-day and 100-day SMA, around 0.7150-55, keeps NZD/USD sellers hopeful.